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Topic: IAG To Acquire 100% Of Vueling
Username: realsim
Posted 2012-11-07 12:37:32 and read 1457 times.

Hi,

IAG, who has a 46% (non controlling) stake in Vueling, will make an offer to acquire the 100% of the company and be able to manage the company.

Source (Spanish): http://www.expansion.com/movil/2012/...empresastransporte/1352310630.html

[Edited 2012-11-07 12:42:31]

Topic: RE: IAG To Acquire 100% Of Vueling
Username: LHRFlyer
Posted 2012-11-07 12:44:13 and read 1474 times.

Here is a source in English from Reuters:

http://www.reuters.com/article/2012/.../iag-vueling-idUSL5E8M7J1X20121107

Topic: RE: IAG To Acquire 100% Of Vueling
Username: PHX787
Posted 2012-11-07 12:51:35 and read 1474 times.

Hmm I wonder how many people are surprised, and how many saw this coming a mile away. I wonder, when IAG took 46% of Vueling, if people saw that as a step up towards full ownership.

The debt crisis is having one hell of a stab at IB so the layoffs aren't surprising....what will surprise me is if IAG will "merge" IB and Vueling together under one brand.....I don't know if that'd be a good idea.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: kl911
Posted 2012-11-07 12:56:13 and read 1478 times.

Dont they need to get EU approval for this? Having Iberia AND Vueling is not good at all for ticket prices.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: LAXintl
Posted 2012-11-07 13:01:18 and read 1475 times.

Well that is good.

Solves the problem of Iberia Express.

Let Iberia operate its core network business markets out of the Madrid hub and let Vueling deal with much of the rest of the country and LCC markets.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: IBERIA747
Posted 2012-11-07 13:07:11 and read 1475 times.

Quoting PHX787 (Reply 2):
I wonder, when IAG took 46% of Vueling, if people saw that as a step up towards full ownership.

IAG didn't take 46% of Vueling.
It was Iberia, actually, which after the Clickair-Vueling merger ended up controlling 45,8% of Vueling. Clickair was 100% owned by Iberia.
This happened in 2009, before the Iberia-British Airways merger.

Quoting PHX787 (Reply 2):
.what will surprise me is if IAG will "merge" IB and Vueling together under one brand.

I don't know how accurate this is, but what's being mentioned here is that it's Iberia (within the IAG umbrella) which will make the offer to fully absorb Vueling.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: AIR MALTA
Posted 2012-11-07 13:12:31 and read 1472 times.

Quoting LAXintl (Reply 4):
Well that is good.

Solves the problem of Iberia Express.

Let Iberia operate its core network business markets out of the Madrid hub and let Vueling deal with much of the rest of the country and LCC markets.

Vueling could also be used by BA to counter U2 domestically may be by opening small bases at MAN, BHX or EDI. The Vueling brand is very catchy and I have to say that they are one of the best low costs out there.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: C010T3
Posted 2012-11-07 13:41:41 and read 1474 times.

This has always been the most obvious move, but will the EC allow it?

Topic: RE: IAG To Acquire 100% Of Vueling
Username: AIR MALTA
Posted 2012-11-07 13:45:01 and read 1474 times.

Quoting C010T3 (Reply 7):
This has always been the most obvious move, but will the EC allow it?

There is no reason they won't allow it. IB and VY networks do not overlap except for the BCN-MAD route.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: LHRFlyer
Posted 2012-11-07 13:48:34 and read 1474 times.

Quoting PHX787 (Reply 2):
The debt crisis is having one hell of a stab at IB so the layoffs aren't surprising....what will surprise me is if IAG will "merge" IB and Vueling together under one brand.....I don't know if that'd be a good idea.

I don't think they will merge. The rationale behind Iberia Express was in part that Vueling was quite different to Iberia mainline (single class cabin etc) and IAG wanted/needed a carrier with economy and business class to feed long-haul routes at Madrid.

Based on what's been said so far in the press, IAG/Iberia seems to be pressing ahead with the restructuring of Iberia this week and if IAG can't expand Iberia Express as it wants the alternative seems to be the radical restructuring of Iberia being announced on Friday.

Whatever happens, interesting times ahead!

Topic: RE: IAG To Acquire 100% Of Vueling
Username: FoxDelta
Posted 2012-11-07 14:14:55 and read 1469 times.

Vueling was set to annouce business class in their flights.

Rumours say IBExpress is to be merged with Vueling in the same operation...

IB left BCN and let Vueling grow there, then they established ClickAir to compete with Vueling. Eventually they were merged, and now IB wants full control of Vueling?? Are'nt we missing something here?

Cheers   

Topic: RE: IAG To Acquire 100% Of Vueling
Username: IBERIA747
Posted 2012-11-07 14:50:32 and read 1469 times.

Quoting LHRFlyer (Reply 9):
if IAG can't expand Iberia Express as it wants the alternative seems to be the radical restructuring of Iberia being announced on Friday.

It's actually the opposite situation. The more IB Express grows, the smaller IB mainline will get as the former is taking over the latter's short and medium haul routes. IB mainline may end up having no more than 40-50 aircraft within a few years as more and more narrowbodies are transferred to IBX (after having about 170 less than 10 years ago, and this without including IB Regional), so the radical restructuring is a given. It's not something that will happen only if IB Express can't grow.

It's a known fact that IB needs to reorganize itself in order to be more efficient and attractive so it can face the current and future market situation, but the plans for this don't seem to have the stregthening of IB mainline in mind.

Even the announced new corporate image seems to have been put on hold, according to some IB A340 captains. They even say that the new A330-300s which will start arriving in Juanuary, will come with a "temporary" all-white livery with red Iberia titles only. I can't confirm if this is true, though.

[Edited 2012-11-07 14:59:11]

Topic: RE: IAG To Acquire 100% Of Vueling
Username: realsim
Posted 2012-11-07 15:29:41 and read 1469 times.

Quoting kl911 (Reply 3):
Dont they need to get EU approval for this? Having Iberia AND Vueling is not good at all for ticket prices.
Quoting C010T3 (Reply 7):
This has always been the most obvious move, but will the EC allow it?

IB and VY overlap in very few routes, and in Spain there is plenty of competition both in the internal market and the international market. Ryanair is the largest airline in Spain in terms of passengers carried, and there is also Easyjet and Air Europa flying from MAD and BCN. The merger between IBexpress and VY will have much less impact in competition than other acquisitions that have been allowed, such as BA/BMI or Alitalia/Air One. And, regarding internal market share, the share between IB/VY in Spain will be much lower than the share AF has in France or AZ in Italy, for example. However, we all know that, sometimes, the EU Comission has different standards depending on the country...

Quoting LHRFlyer (Reply 9):
I don't think they will merge. The rationale behind Iberia Express was in part that Vueling was quite different to Iberia mainline (single class cabin etc) and IAG wanted/needed a carrier with economy and business class to feed long-haul routes at Madrid.

It has been reported that they actually plan to merge both airlines. I don't know if this is a way to put pressure on the employees of IB or if it is the real plan, but I imagine it's the second one. IB will be a long-haul airline operating from MAD to Latin America, and IBExpress/Vueling will fly the short/medium-haul routes from MAD, BCN and other airports. The question is what brand will be used. IB Express seems a more logical option for feeding IB long-haul flights, but VY is a cool brand and it's becoming more and more known and solid. If they wanted to, they could use both, like the regional operators in the USA. "Iberia Express operated by Vueling" for flights ex MAD, and Vueling for flights from BCN and p2p routes. However, this is all speculation, and we'll have to wait until Friday to know more details.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: r2rho
Posted 2012-11-08 04:59:10 and read 1461 times.

VY is already to all effects and purposes an IB subsidiary, so this changes absolutely nothing from a competitive point of view.

IB had planned to use IB Express at MAD and VY at BCN for short-haul and feed, but the whole IB Express setup is now back to square one:

"The Spanish High Court has overturned the original arbitration process that nominally ended the conflict between Iberia and pilots union SEPLA, saying it was technically flawed and should be restarted."

http://www.flightglobal.com/news/art...are-one-after-court-ruling-378590/

So IMO this is a way to put pressure on the unions: if we can't have IB Express, we'll use VY to take it's place instead.

See also the parallel (and quite related) discussion:
IB/I2 Suspends AMS, ARN, TXL (by SCQ83 Oct 29 2012 in Civil Aviation)

Quoting LAXintl (Reply 4):
Let Iberia operate its core network business markets out of the Madrid hub and let Vueling deal with much of the rest of the country and LCC markets.

That is already the case today. The next part of the plan was to have IB Express gradually operate all ex-MAD short-haul, with IB mainline doing long-haul only. That plan has now been reversed, so IB management is trying an alternative way through VY.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: LHRFlyer
Posted 2012-11-08 06:12:22 and read 1461 times.

An offer has been formally made by IAG:

http://www.iagshares.com/phoenix.zht...-newsArticle&ID=1756240&highlight=

Topic: RE: IAG To Acquire 100% Of Vueling
Username: roberto277
Posted 2012-11-08 09:26:46 and read 1467 times.

Does anyone know why IAG offered 'only' €113 million for a company with €805 million of assets in september? Makes me curious. I think they may set up a joint low cost/ short haul business. One business with two brands like suggested earlier. They followed the same strategy with the cargo business. Wouldn't they pay more if they weren't just in it for the slots and the brand? What's to stop them from doing the same as with BMI in a later stage? Is likebility of the Vueling brand enough?

Topic: RE: IAG To Acquire 100% Of Vueling
Username: jumpjets
Posted 2012-11-08 11:45:03 and read 1463 times.

Quoting roberto277 (Reply 15):
Does anyone know why IAG offered 'only' €113 million for a company with €805 million of assets in september?

Vuelling is a listed company whose shares are publicly traded so the market price is more important than the gross asset position of the company in determining the price to be offered by a potential purchaser. The IAG offer of 113m euro is based on 7 euro per share for all the shares in Vuelling not currently held by IB.

Once IAG made their announcement the Vuelling shares were suspended from trading - the closing price was 5.47 euro per share, so the IAG offer is some 25% above the market rate. I guess they hope that premium will be enough to attract enough shareholder to sell and give IAG control - and once they have control the remaining shareholders, whether they want to sell or not won't have much say in the future of Vuelling and so may as well sell as well.

Topic: RE: IAG To Acquire 100% Of Vueling
Username: VV701
Posted 2012-11-08 19:18:55 and read 1461 times.

Quoting roberto277 (Reply 15):
What's to stop them from doing the same as with BMI in a later stage?

IAG sold the bmi/British Midlland brand along with British Midland Regional Airways to Sector Aviation Holdings on 1 June. SAH plan to continue to operate bmi Regioal under its current brand.


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